Trump’s Immigration Crackdown Is Driving Tech Jobs into Mexico’s Arms

Quick, what’s the last place Donald Trump would want to see jobs go, American or otherwise? If you answered Mexico, that’s probably correct! After making one of the key pillars of his campaign how terrible our neighbors to the south are, and outlining all the things he would do as president to punish them (building the wall, ripping up NAFTA, mass deportations, etc.) Trump, in the infinite wisdom one accumulates hosting a reality-TV show, has unwittingly created a situation wherein major tech companies are now running to Mexico to escape a separate set of potentially terrible policies.

As part the Trump administration’s sweeping crackdown on immigration, last month the president signed an executive order initiating a government review that is expected to make it harder for companies to obtain H-1B visas for foreign workers, who Team Trump believes are “undercutting American labor at less cost.” And while the move has spurred some companies, like outsourcing giant Infosys, to announce they will hire thousands of Americans in the coming years, others are prepping to head south.

The Financial Timesreports that Tech Mahindra, one of the largest I.T. services companies in India, will “double its operations in Mexico in the next year to 18 months if the U.S. makes it more difficult for Indians to get skilled H1-B visas.” Sayeth Arvind Malhotra, the company’s global head of strategic accounts and South America: “We’ve been having several conversations that we want to ramp up the operations in [Latin] America—especially English-speaking operations—because of the current administration.” Basing its employees in Mexico, the F.T. notes, would allow Tech Mahindra “to send people quickly and cheaply across the border into the U.S. to provide services that are currently done by its large U.S.-based staff.” Other firms like Austin-based iTexico recently opened an office in Aguascalientes, while software nearshorer ArkusNexus has built operations in Tijuana; Luxoft, a Swiss outsourcer, has said its “stretch goal” is to double is presence in Mexico.

Andres Barreto, a serial entrepreneur who came to the U.S. on an H-1B visa and focuses on working with founders to build engineering teams outside of the country, told the Hive last month that a growing number of Latin tech stars are staying put and working remotely, while more V.C.-backed firms in the U.S. are seeking to build teams elsewhere. “Just for our fund, we have six Y-Combinator companies that have a product for the U.S. market, but their engineering team is all in Latin America or they are starting to build teams in Latin America,” he said.

Meanwhile, Aristóteles Sandoval, the governor of Jalisco, has wasted no time letting companies know that if Trump makes it too hard to do business in the U.S., Mexico is here for them. Per the F.T.:

He toured Silicon Valley earlier this year with the message that the province wants to be a “sanctuary” for highly skilled workers. Jalisco put a full page advert in the US publication Politico, offering to work with tech companies. It is also loosening immigration rules for new companies setting up shop, ditching an old requirement that companies could only have 10 per cent foreign employees.